SINGAPORE (Dow Jones)--Asian stock markets were mixed Tuesday as investors awaited fresh developments around the Greek debt crisis, while most regional oil stocks struggled despite a mild recovery in oil prices.
Japan's Nikkei Stock Average rose 0.7%, Australia's S&P/ASX 200 advanced 0.3%, South Korea's Kospi Composite rose 0.6%, Hong Kong's Hang Seng Index was flat, China's Shanghai Composite Index fell 0.6% and India's Sensex was flat.
Dow Jones Industrial Average futures were up 11 points in screen trade.
Wall Street's gains on Monday and optimism that euro-zone officials were moving closer to a resolution to the debt crisis in Greece offered some encouragement to buyers in the region.
Still, the recent volatility in markets is likely to persist until a final resolution to the Greece debt problems are in place, analysts said.
"The grounds for (Tuesday's) optimism is rather shaky and sentiment can turn quickly on any negative news or comments that come out later," said Hideyuki Ishiguro, strategist at Okasan Securities.
A modest recovery in oil prices failed to sufficiently draw buyers for oil-related stocks in the region; Inpex was up 0.7% in Tokyo, SK Innovation rose 2.0% in Seoul, while in Hong Kong Cnooc was off 0.7% and Woodside Petroleum lost 0.8% in Sydney.
August Nymex crude oil futures, which have been under selling pressure on global demand worries, and since last week's decision by the International Energy Agency's decision to release strategic crude oil reserves, were recently up 25 cents at $90.86 per barrel on Globex.
While the euro-zone debt woes have hampered risk-appetite in recent months, investors have also continued to worry about the global growth outlook.
"Equity markets are still very skittish," said Sydney-based BBY senior institutional dealer, Peter Copeland. "There's no strong conviction that European sovereign debt worries will be resolved soon and that the U.S. economy is out of trouble in regard to anemic economic growth, and debt ceiling worries. Any bounce is being treated with caution."
In Tokyo, major exporters such as Honda Motor and Olympus were up 1.2% and 1.6%, respectively, helped in part by the pullback in the yen against the euro on Monday.
Toyota Motor added a modest 0.3%, while Nissan Motor dropped 2.1% as it took a breather after notching up solid gains recently.
Automaker and construction stocks supported the Seoul market.
Korea Express was among the few stocks bucking the trend. The stock lost 5.7% as it took a breather after a 56% surge since May 31 on takeover-related activity. On Monday, a consortium led by Posco and CJ Group submitted final bids for a controlling stake in the logistics company, but the Lotte Group walked out of the deal due to weak business synergy.
"Investors are selling the stocks on profit taking just before the selection of the preferred bidder for Korea Express," said Yang Ji-hwan at Daishin Securities.
Posco was up 1.4%.
In Taiwan, Chimei Innolux was down 1.6% after the world's third-largest maker of liquid-crystal-display panels by revenue said it would cut its capital expenditure for 2011 by 20%-30% from NT$100 billion it had earmarked previously due to global economic uncertainties.
Elsewhere, Taiwan's Taiex was off 0.2%, Singapore's Straits Times Index was flat, Malaysia's Kuala Lumpur Composite Index gained 0.2%, Philippine shares were flat, Indonesian shares rose 0.3%, shares in Thailand climbed 0.2% and New Zealand's NZX-50 was down 0.1%.
The fluctuating fortunes of the euro with the ebb and flow of developments around the Greek debt crisis continued to dominate foreign exchange trading. The single currency was steady in Asian trade after rising on Monday on growing hopes the Greek parliament will pass a package of austerity measures this week and on optimism about the prospect of a broad plan with European Union guarantees to rollover Greek debt with the possible involvement of private creditors.
Some traders continued to advocate caution around the Greek debt situation. "The (Greek) opposition continues to press for re-negotiation and rejects the government's plan," Brown Brothers Harriman said in a note to clients. "The government survived a vote of confidence recently only after a reshuffle of the government and even then it did so with a four vote margin. While passage is still the most likely scenario, a very narrow margin may not elicit a sigh of relief," it added.
The euro was fetching $1.4293, from $1.4282 late in New York on Monday, and Y115.50 against the yen, from Y115.53. The dollar was at Y80.80, compared with Y80.89.
September Japanese government bond futures were down 0.07 at 141.49 points, on the Nikkei's strength and losses in U.S. Treasurys Monday. The 10-year cash JGB yield was 0.5 basis point higher at 1.100%.
Spot gold was at $1,498.60 per troy ounce, up $1.70 from its New York settlement on Monday.
-Shri Navaratnam, Dow Jones Newswires; +65-6415-4142; shri.navaratnam@dowjones.com
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